Financial Markets Daily Report
13 julio 2023

A lower-than-expected reading of Junes US inflation led investors to project a lower path for the Federal Reserves interest rates. Concretely, headline and core inflation fell by 1pp and 0.5pp to 3.0% y/y and 4.8% y/y, respectively.

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  • A lower-than-expected reading of Junes US inflation led investors to project a lower path for the Federal Reserves interest rates. Concretely, headline and core inflation fell by 1pp and 0.5pp to 3.0% y/y and 4.8% y/y, respectively.
  • In addition to these general figures, detailed components also offered a bright outlook for inflation returning to 2%. Shelter inflation, which accounts for more than 40% of the core basket of consumption, eased to 0.4% m/m and used vehicles inflation, which posted unusually high rates in the preceding months, fell to -0.5%.
  • Elsewhere, the central bank of Canada hiked its policy rate by 25bp to 5% and New Zeelands paused after 12 consecutive months of hikes.
  • In this context, yields on sovereign bonds declined markedly, equity indices rebounded across the board while the USD depreciated against its peers, trading above 1.11 against the euro.
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